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1 THE CONSUMER Part 1: Needs & Wants, Consumer Demand, Product Life Cycles.

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Presentation on theme: "1 THE CONSUMER Part 1: Needs & Wants, Consumer Demand, Product Life Cycles."— Presentation transcript:

1 1 THE CONSUMER Part 1: Needs & Wants, Consumer Demand, Product Life Cycles

2 2 The Consumer A consumer is the person who uses the product. A customer is the person who buys the product. Wouldn’t this be the same person? Some examples when they are not?

3 3 The Consumer In the case of a parent or guardian of a child, the parent is considered a gatekeeper—a person who oversees the care of another. Marketers attempt to appeal to the gatekeeper as well as the consumer. Why?

4 4 Who is the Customer? Who is the Consumer? Who is the Gatekeeper?

5 5 Another Scenario: Customer vs Consumer Who is this? Customer... the Fans... (consumers) Who is the Customer? Where does he fit in “the Marketing Mix”? the PRODUCT (Derrick Rose)...and the Consumer is...

6 6 Consumer Behaviour Consumer behaviour is based on how the marketing mix interacts with the psychology of the Buyer. Buyer psychology includes their own culture, attitude, previous learning, and personal perceptions.

7 7 Needs and Wants self-actualization/fulfillment esteem belonging safety physiological Maslow’s Heirarchy of Needs It all comes down to:

8 8 Needs and Wants In our society, most people do not have difficulty satisfying needs. Wants are items not necessary for survival, but add pleasure and comfort to our lives.

9 9 Needs and Wants In places with poverty, war, or oppression basic needs may not be met. Marketing focuses on meeting needs.

10 10 Needs and Wants In developed countries, demand is more driven by wants. Marketing presents alternatives, and helps customers set up value equations for each.

11 11 Consumer Demand Consumer demand changes based on economic shifts and availability of new products. economy is stableunemployment down demand for goods and services UP people will buy things they want economy is in a slump unemployment up demand for goods & services DOWN people will only buy things they need

12 12 Consumer Demand Demand also changes based on wants, needs, or changes in perceived value. Marketers need to make decisions based on: educated guess, research, historic trends Former Marketing Market Guru

13 13 Consumer Demand Demand changes as retailers enter/exit the marketplace. Too many sellers of a product =  demand As some close, less product available =  demand Misreading a market can mean disaster >

14 14 Humour Break Actual Consumer labels > On a Sears hairdryer: Do not use while sleeping. > On a bag of Fritos: You could be a winner! No purchase necessary. Details inside. > On a bar of Dial soap: Directions: Use like regular soap. > On Boot's children's cough medicine: "Do not drive a car or operate machinery after taking this medication." > On Nytol sleep aid: Warning: May cause drowsiness. > On an Airline packet of peanuts: "Instructions: Open packet, eat nuts." > On a child's Superman costume: "Wearing of this garment does not enable you to fly.“

15 15 Consumer Demand Understanding fluctuations in consumer demand is essential to marketing. Because of this, marketers also use product life-cycle models to predict the life of new products. no product can be in demand forever see trends, technology and lifestyles change, affect consumer demand

16 16 The traditional PLC consists of four stages

17 17 Nontraditional Product Life Cycles These include: Fads, Trends, Niche Markets, and Seasonal Markets.

18 18 Nontraditional Product Life Cycles Fads

19 19 Nontraditional Product Life Cycles Fads A product which is extremely popular for a very brief period of time, and loses popularity just as quickly. Rubik’s cube, Cabbage Patch Kids, tamagotchi, Pet rock …(you researched this already)

20 20 Nontraditional Product Life Cycles Fads Fads are unpredictable, and high- risk. Companies try to get out of the market just as the fad peaks. If they wait too long, they get stuck with excess inventory.

21 21 Nontraditional Product Life Cycles Trends

22 22 Nontraditional Product Life Cycles Trends A trend has a more lasting effect on the market than a fad. A trend is usually a movement towards a style of product. Organic foods, Beanie babies, the Simpsons, cell phones

23 23 Nontraditional Product Life Cycles Niche Markets

24 24 Nontraditional Product Life Cycles Niche Markets A small section of the market dominated by a small group of products that meet real, but unique needs and wants. Short growth, level maturity, limited competition.

25 Great Niche Market Entrepreneurs: Alex Tew: The Million Dollar Homepage. This website was conceived in 2005 by Alex Tew, a college student from Wiltshire, England. The purpose of the website was to raise money for his college education. The home page consists of a million pixels arranged in a 1000 × 1000 pixel grid; the image-based links on it were sold for $1 per pixel in 10 × 10 blocks. Alex’s ultimate goal was to sell all of the pixels in the image, thus generating a million dollars of income. He achieved that goal on January 11, 2006, when the final 1000 pixels were put up for auction on eBay. http://www.milliondollarhomepage.com Marla Cilley: FlyLady Who knew being a professional nag could be so profitable? Marla Cilley, “FlyLady” makes millions by nagging her approximately 550,000 e-mail subscribers known as “Flybabies”, to do things such as get up and get dressed for work, polish their sink, get their nails done, cook dinner and yes…go to bed! In 2010, sales of Marla’s nag business reached 4 million. Marla’s website: http://flylady.net Sami Bayrakci: SomethingStore Do you like surprises? SomethingStore is a website launched in October 2007, that will send you “something”, randomly selected from thousands of products in their diverse inventory, for $10 (free shipping in the US), and you will discover what your something is when you receive it. 25

26 26 Nontraditional Product Life Cycles Seasonal Markets

27 27 Nontraditional Product Life Cycles Seasonal Markets Consumer demand changes and is effected by the weather. Marketers anticipate periods of high and low demand, and work to create off- season opportunities. Ice cream parlours, resorts, lawn mowers, snow shovels, ice skates

28 28 Joke Break TEACHER: Why are you late? WEBSTER: Because of the sign. TEACHER: What sign? WEBSTER: The one that says, "School Ahead, Go Slow."

29 29 Why don't cats play poker in the jungle? Too many cheetahs Another Joke Break

30 30 ACTIVITY My Fives At your tables, try to identify five specific products which follow each of the non-traditional PLCs. (The ones presented in class do not count!) PRIZES FOR BEST TABLE !

31 31 a)Go to the Course Web page, Unit 2 and copy the questions for this PPT into a blank Word file. Transfer your own answers under each question, put your name at the top of the file. b)Add the notes from the “My Fives” Activity to the end of the above questions/answers. c)For a mark, save your completed file using the following file name: FirstName_Lastname_Consumer_P1.doc d)Drag the file into the correct folder (by day and period) into the Drop-Off>ROBINSON folder. ASSIGNMENT (for Marks) Part 1: Needs & Wants, Consumer Demand, Product Life Cycles

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